(723g) Optimizing Tank Fleet in Chemical Supply Chains

Tank fleet flows constitute an important and expensive part of chemical supply chains as the storage and transportation of chemical products are strictly controlled under safety and environmental regulations. A typical tank fleet flow starts from manufacturer which fills up a tank fleet with chemical and transports it to distribution center. Distribution center then delivers it to customer based on existing orders. Customer holds the tank fleet till it consumes all the chemical products, and returns the empty tank fleet to distribution center or manufacturer. Shortage of chemical tank fleets on the manufacturer side would force the plant to shut down, resulting in huge financial losses and customer service level decreases. In the meantime, the lead time for enterprises to get new tank fleets after order placement is very long. Therefore in the reality, chemical enterprises always prefer to hold a huge amount of expensive tank fleets and keep purchasing new ones from suppliers. As a result, it provides large opportunities for cost reductions in chemical supply chains through efficient and effective management of tank fleets.

To address the tank fleet management problem, we developed an agent-based discrete event simulation model of supply chain. This model contains a chemical enterprise, multiple customers, and market. The chemical enterprise comprises multiple plants, multiple warehouses, order coordinator, replenishment coordinator and logistics department. These supply chain entities are functioning on certain rules and policies, and make decisions based on their own interests. And they communicate and collaborate with each other in various activities including end product sale, order placement, order assignment, inventory management and replenishment planning, which construct the tank fleet flows of the supply chain. We started from a base case with simple policies and investigated the usage of tank fleets on entities and transportation under different scenarios. Afterwards we employed various policies and rules into plants, warehouse and logistics department, and evaluated the respective tank fleets movement performance through simulation-optimization techniques. The emphasis of our work is on the development of efficient and effective chemical tank fleet management policies.